Sales down, but profit surges, at A. Schulman

FAIRLAWN, OHIO (Oct. 26, 1:15 p.m. ET) — A. Schulman Inc. — one of North America’s leading compounders — just wrapped up a fiscal year in which profit jumped more than 25 percent, even as sales dipped slightly.

Schulman’s sales for the year ended Aug. 31 were just over $2.1 billion, down almost 4 percent from sales of almost $2.2 billion in fiscal 2011. But profit surged almost 27 percent to just over $52 million in the same comparison.

“In fiscal 2012, we delivered on our promise to control what we could in a tough environment,” chairman, president and chief executive officer Joseph Gingo said in an Oct. 24 news release. “I’m pleased with our results.”

“With that said, we’ll aggressively look for ways to continue to deliver value to our shareholders given expected tepid global growth, at best, in fiscal 2013,” he added.

Schulman’s sales in the Americas grew eight percent to almost $559 million in fiscal 2012, while operating income more than doubled to almost $29 million. Sales in Europe, the Middle East and Africa, however, fell eight percent to just over $1.4 billion, as several European countries struggled financially. Operating income in that region fell 17 percent to less than $72 million.

The EMEA region continued to be Schulman’s primary sales region in fiscal 2012, contributing 67 percent of sales and almost 65 percent of operating income. The Americas chipped in with almost 27 percent of sales and just over 25 percent of operating income.

Schulman also made two acquisitions during fiscal 2012 and now has made six in the last three calendar years. Its fiscal 2012 purchases were specialty color concentrate maker Elian SAS of Oyonnax, France, and specialty compounder ECM Plastics Inc. of Worcester, Mass. Schulman paid $63 million for Elian and $36.5 million for ECM.

On Wall Street, Schulman’s per-share stock price has performed well during the 2012 calendar year so far. It began the year around $22 and was near $25.50 in early trading Oct. 26, for an increase of more than 15 percent.